Bitcoin’s Philanthropic Arm: Connie Gallippi & BitGive
This is a previously unpublished article based on an interview with Connie Gallippi in June 2017.
Bitcoin for social good
In 2014, a small African charity announced they would be accepting donations in Bitcoin. The Water Project helps Sub-Saharan communities gain access to clean water through training and financial support of well-building and rehabilitation, rain catching systems, and other construction. The group’s Bitcoin announcement caught the eye of Connie Gallippi, founder of BitGive.
“We were looking for our next partner and we wanted to have a longer engagement with the charity and the Bitcoin community,” Connie said. “We wanted to do something in the water area and in Africa. And lo and behold, The Water Project pops up!” BitGive connected with The Water Project and the two organizations quickly worked together to build a campaign to fund a new well in Kenya entirely with Bitcoin.
Typically The Water Project takes donations of any size from audiences all over the world, using the total amount raised to complete projects. “But,” Connie said, “we wanted to get the whole project done so we could say we accomplished something in its entirety and engage the Bitcoin community.” And that’s exactly what they did. “We raised enough money for the whole project, a little over $11,000, all in Bitcoin.”
While funding the well in Kenya, BitGive built a strong relationship with The Water Project, and when it came time for the well to be built, Connie wanted to be there. “I had this crazy idea that I wanted to go there and be there when it was done and I wanted to film it so we could show our donors the project they had completed.”
With the help of the Water Project, Connie made the journey into Kenya to film the completion of the well that Bitcoin funded.
The philanthropic arm
Despite knowing people early in the industry, Connie didn’t expect to ever work with Bitcoin, saying her involvement came out of nowhere. She became completely immersed in the culture and the technology around the cryptocurrency at the first Bitcoin conference in 2013 in San Jose. “When I got to that point,” she said, “seeing what the real potential was around Bitcoin, it really came to me in a weird lightbulb moment of, ‘We have to have a philanthropic foundation.’”
“This tech is going to take off and it’s going to change everything. That was the original idea, to have a philanthropic arm.” — Connie Gallippi
Founding BitGive was catalyzed not only by the potential of Bitcoin’s underlying technology, but its promise of transparency and accountability which Connie believed would put the cryptocurrency at the cutting edge of reporting and donor engagement. BitGive filed for 501(c)(3) status in 2013 before any real form of structured guidance from regulatory entities existed.
impacting over 50,000 people in 28 countries globally
Connie and the team worked with law firm Perkins Coie to establish the organization and to file with the IRS for approval. “They told us normally it can take anywhere from a year to two or three years to get an approval, and that’s for a normal charity, not a Bitcoin charity!” she said, laughing. In August of 2014, nine months after filing, BitGive was officially a registered non-profit.
“That was a very big deal for Bitcoin in general back then, to have such a positive indication from the federal government and especially for something like tax exemptions because we were working with Bitcoin when they hadn’t really released any guidance on it yet. To give us that level of approval for tax deductions for our donors but also for us to not have to pay any taxes on the gains. It was really kind of shocking that they did it.”
By the book
BitGive became the first registered non-profit to deal with questions around how to maintain their bookkeeping in order to properly file with the IRS at the end of the year. For Bitcoin donors, BitGive is able to produce a receipt thanks to their non-profit status. But the receipt is denominated in Bitcoin, so the onus is on the donor to value their donation similar to an in-kind donation and to file their own paperwork when asking for the deduction.
Many charities and companies that accept BTC use a service like BitPay to convert it to a fiat currency to be deposited immediately into a bank account, meaning the organization avoids dealing with the challenges of holding cryptocurrencies. BitGive actually holds Bitcoin, “so it’s a huge effort for us to figure out how to deal with that,” Gallippi explained, “and we’re very lucky to have some knowledgeable accountants and CPAs work with us to figure out our approach.”
Specialized tax software helps, but accurate bookkeeping is still very cumbersome. One year, BitGive was the target of a DDoS attack resulting in roughly 5,000 transactions valued around one penny each, all of which had to go through the non-profit’s reporting system.
Past, present, and future of Bitcoin giving
BitGive started by taking on small projects and raising funds for existing charities. “We had to do things really small-scale because as an industry, Bitcoin was starting out and wasn’t in the kind of financial position to have a philanthropic foundation,” Connie said. The transparency afforded by Bitcoin network transactions was a popular catalyst for many early use cases.
Simultaneously, the philanthropic world was being rocked by stories about misappropriated disaster relief funds in the wakes of Hurricane Katrina and the Haiti earthquake. The BitGive team decided to take on more sophisticated, technical projects and moved beyond fundraising in Bitcoin to start working on GiveTrack. The platform tracks donations and can show donors how a charity is using funds while tying in project milestones and results.
At the time of writing, the organization’s focus was squarely on building the GiveTrack MVP, which Connie noted was close to completion. GiveTrack had a soft launch in December of 2016 with some limited product demos, and BitGive released a beta version to the public in the fall of 2017.
When they initially came up with the idea for GiveTrack, The Water Project was first in line to work with BitGive. Collaborating with a mainstream traditional charity helps demonstrate the potential of the platform, “and it also helps us with design and function, making sure that it actually works for somebody,” Gallippi added. In addition to The Water Project, BitGive brought on another charity they know well, Medic (f.k.a. Medic Mobile), as an early GiveTrack user.
As BitGive grows, Connie and the team remain firmly committed to their belief in the potential of Bitcoin and their decision to build on top of it. “The tech is what it is, and it’s already amazing,” Connie said, “We’re trying to take it and build with it in a way that leverages it for philanthropy. Our end game is to help the charities that are doing good work raise more money and find ways to engage with donors to empower them more.”
